Audit Objective
Did the Village of Leicester (Village) Board of Trustees (Board) effectively manage fund balance?
Audit Period
June 1, 2021 – January 16, 2025
Understanding the Program
A key measure of a village’s financial condition is its level of fund balance, which represents the difference between revenues and expenditures accumulated over time. Maintaining a reasonable amount of unrestricted fund balance within operating funds is an important financial consideration for village officials because it is available for appropriation to reduce taxes, fund one-time expenditures and other uses.
The Board is responsible for the general management and control of the Village’s financial affairs, which includes adopting the annual budget and establishing financial policies. The Clerk-Treasurer is the chief fiscal officer and budget officer.
The Village has two operating funds: general and water. The 2024-25 general fund appropriations totaled $185,700 and water fund appropriations totaled $286,875. The general fund is funded primarily by rental and interest income, real property taxes, State aid and sales tax, while the water fund is funded primarily with metered water sales.
Audit Summary
The Board did not effectively manage the Village’s fund balance or adopt realistic budgets. As a result, officials maintained unrestricted fund balance in the general and water funds totaling $729,709 and $152,143, respectively, at the end of the 2023-24 fiscal year, which was sufficient to fund the upcoming fiscal year’s budget appropriations for the general fund by nearly four times and for the water fund by more than half. The Board also did not adopt a written fund balance policy, develop and adopt comprehensive written multiyear financial or capital plans that would have assisted the Board and officials in developing and adopting realistic budgets and planning for the Village’s financial future.
The report includes five recommendations that, if implemented, will improve the Village’s financial management. Village officials agreed with our recommendations and indicated they will initiate corrective action.
We conducted this audit pursuant to Article V, Section 1 of the State Constitution and the State Comptroller’s authority as set forth in Article 3 of the New York State General Municipal Law. Our methodology and standards are included in Appendix C.
The Board has the responsibility to initiate corrective action. A written corrective action plan (CAP) that addresses the findings and recommendations in this report should be prepared and provided to our office within 90 days, pursuant to Section 35 of General Municipal Law. For more information on preparing and filing your CAP, please refer to our brochure, Responding to an OSC Audit Report, which you received with the draft audit report. We encourage the Board to make the CAP available for public review in the Clerk-Treasurer’s office.